Haiti’s New Envoy Wants Investment Dollars, Not Pity

By Larry Luxner Uploaded on August 31, 2012

On Jan. 12, 2010 — the day a powerful earthquake destroyed Haiti's capital city and wrecked its economy — Paul Altidor was at the Hotel Montana in Port-au-Prince, advising his government on a pending deal to privatize the state-owned phone monopoly.

At 4:53 p.m., the aspiring World Bank economist felt the ground move beneath him. When the violent shaking ended about 40 seconds later, what had long been the most luxurious hotel in Haiti — an air-conditioned oasis in the Western Hemisphere's poorest country — was now an unrecognizable mess of concrete, a tomb trapping hundreds of locals, tourists and international aid workers. The rumbling turned to screams as people all over the city realized what had just happened.

It's not something Altidor likes to discuss.

"Let's put it this way," Haiti's new ambassador told The Washington Diplomat. "When it comes to the earthquake, I happen to be one of the luckiest people around. I came out with only a very small scratch. But many of the folks at the Montana died. I had gone there so often on business, the employees became my closest friends."

Photo: Jessica Latos

Ambassador Paul Altidor

The Haitian government says 316,000 people lost their lives in the magnitude-7.0 quake, a far higher number than the official 230,000 figure released shortly after the disaster. Altidor says the actual death toll may never be known.

"Emotionally, the country wasn't prepared for the magnitude of what happened that day," said the 39-year-old envoy, who didn't lose any immediate family in the quake.

It did change his life, however.

Instead of continuing his career with the World Bank's International Finance Corp., Altidor became vice president of the Clinton Bush Haiti Fund, a Washington-based nonprofit headed by former presidents Bill Clinton and George W. Bush that since the disaster has raised $54 million in donations to help Haiti get back on its feet. And Haiti needs all the help it can get — as of press time, Tropical Storm Isaac was barreling toward the country, threatening to dump eight to 12 inches of rain on the makeshift tent cities and crumbling hillsides that are prone to flash floods and deadly mudslides.

Altidor's performance at the Clinton Bush Haiti Fund and his years of experience in the private sector so impressed Laurent Lamothe — Haiti's foreign minister at the time — that Lamothe asked him to head Haiti's embassy in Washington, D.C.

Since 2004, that mission had been run by the affable Raymond Joseph, who stepped down in August 2010 to run for president of Haiti. Then-President René Préval appointed Louis Harold Joseph (no relation) to replace him.

But the elder Joseph was soon disqualified from running because the Préval government claimed that he lacked official clearance to participate; Joseph took the case to court but the issue was never resolved. The tumultuous campaign was eventually won by Michel Martelly, a popular singer and right-of-center politician who — upon taking office in May 2011 — proudly declared that Haiti was now "open for business."

Indeed it is, says Altidor, who presented his credentials to President Obama on May 2 amid plans to reinvent his embassy from top to bottom.

"As you may have heard, our goal is to make Haiti an emerging economy by 2030," he told us. "We feel that diplomacy has a key role to play in lifting Haiti from where it is right now to the next level by using the embassy to promote Haiti as an investment destination."

Doing that, of course, takes money. Just renovating the dilapidated mission on Embassy Row is itself a $2 million construction job, but Altidor said his budget is essentially being doubled. He's also bringing new people on board who can get the word out that post-earthquake Haiti wants foreign investment (also see "Two Years After Quake, Haiti Lobbies for Investment" in the January 2012 issue of The Washington Diplomat).

"Resources are being put at the disposal of our various diplomatic missions around the world. This is fairly new in Haiti's recent history," said Altidor, who plans to expand his staff of 34. "We're hiring not just diplomats, but also folks with business backgrounds in the private sector. So I have people here with MBAs and law degrees who used to work on Wall Street. Bear in mind that in the aftermath of the earthquake, a lot of Haitians and Haitian-Americans have embraced those ideas. It's been harder to keep people at bay than to attract talent."

A big part of this push has to do with the Martelly government's perception that its Washington embassy has been ignored by State Department bureaucrats and even U.S. companies hoping to export to the impoverished Caribbean nation of more than 9 million.

"We're undergoing this major renovation not just to make it pretty for the sake of being pretty, but because it's the gateway to Haiti," the ambassador said, noting that "our cultural section will also be revitalized. We have very robust cultural planning for the coming year, as this will become a destination for major cultural events."

Among them, he said: presentations by Phillippe Dodard, who works with fashion designer Donna Karan, and Haitian filmmaker Raoul Peck, whose 2005 TV documentary "Sometimes in April" chronicled the genocide in Rwanda that left 800,000 people dead.

Photo: Larry Luxner

Tons of debris have been removed and tent cities taken down in Port-au-Prince, though homelessness, poverty, crime and susceptibility to flooding and mudslides still plague Haiti's quake-ravaged capital.

Peck's inclusion in the upcoming cultural calendar is no coincidence, since Rwanda is precisely the model Haiti would like to follow as it struggles to regain its footing in the wake of the worst natural disaster in Caribbean history.

Whether Haiti can achieve the kind of economic growth Rwanda has experienced over the last decade is a matter of debate, though it certainly helps that Altidor has the solid backing of his bosses in Port-au-Prince (Lamothe has since been named prime minister).

"I'm getting political support from my administration that I don't think any of my predecessors had," said Altidor. "I'm sure Mr. Joseph would have wanted to have the level of resources I'm getting."

Joseph, now 81, said Altidor recently tracked him down while in Port-au-Prince, hoping to pick up some valuable advice from an elder statesman on how to be an effective ambassador in Washington.

"I found him to be a humble person who listens well," Joseph told The Diplomat by phone. "He praised me for the way I dealt with the Haitian community. Whether he's going to have a different approach, I don't know. But at least he acknowledged there was good work done, and that he wants to continue that legacy. Apparently, he has more pull within the administration than I did, and I wish him well."

It also helps that Altidor spent seven years in Washington and knows its think tanks, diplomatic missions and financial institutions intimately.

Born and raised in the Haitian town of Jérémie, Altidor finished high school in Boston after his family relocated there, then earned a degree from Boston College and an advanced degree from the Massachusetts Institute of Technology. At the International Finance Corp., his job was to help governments divest of state holdings by forming public-private partnerships.

Altidor met his wife, Meghan, while both were students at MIT (she's now an affordable housing attorney at the Washington law firm Nixon Peabody). And following the quake, he led a team of professors and researchers from MIT's Community Innovators Lab to Haiti to provide guidance on housing policy and financing.

"I understand Haiti and the dilemma it's facing in terms of development, getting it right and using business diplomacy to move Haiti toward the goal of being an emerging economy by 2030," he said. "A lot of folks come to Haiti with good intentions but with preconceived solutions they think will work, as opposed to local priorities. Over the last 30 years, Haiti had become so dependent on foreign aid that it's weakened the government, which was the very institution that was supposed to protect Haiti's interests. So these people end up wasting resources, not because it's malicious on their part but because they think they know better."

He added: "Of course we need money to rebuild our infrastructure, but at the end of the day, the debate is about how efficiently the money that's already been allocated is being utilized."

The Inter-American Development Bank alone has pledged $2 billion in new grants to Haiti over a decade, reported the New York Times, while Congress appropriated $1.14 billion for reconstruction — much of it set aside for debt relief, health care, and food and justice programs.

All told, private U.S. and overseas donors have pledged more than $11 billion in post-earthquake assistance to Haiti through this year, though local sources say only half of that aid has actually been delivered.

Meanwhile, Haiti's government and the international donor community have come under intense criticism for a haphazard rebuilding effort that lacks any coherent, long-term vision.

Housing, or the enduring lack thereof, is emblematic of this problem. Progress is certainly visible in the nation's capital, whose shoddily constructed buildings were decimated by the quake. For instance, the park that sits directly in front of Haiti's quake-ravaged presidential palace in downtown Port-au-Prince has finally been cleared of refugees. The Champs de Mars "tent city" was often visited by reporters and TV crews hoping to highlight the plight of homeless Haitians with nowhere to go, though it eventually became more of an embarrassment than anything else.

But hundreds of thousands of Haitians remain homeless, many in putrid tent camps susceptible to storms like Isaac — a plight that was documented in the recent New York Times article "Years After Haiti Quake, Safe Housing Is a Dream for Many," by Deborah Sontag.

"In the absence of an overarching housing policy, Haiti's shelter problem has been tackled unsystematically, in a way that has favored rural over urban victims and homeowners over renters because their needs were more easily met. Many families with the least resources have been neglected unless they happened to belong to a tent camp, neighborhood or vulnerable population targeted by a particular program," Sontag wrote.

Altidor admits the housing challenge is a mammoth one, but also points out the tremendous strides that have been made.

"At one time, the number of people living in tents was 1.5 million. Now it's down to less than 400,000. Some folks went back to their communities of origin, and some to new housing developments," said the ambassador, an avid soccer fan who plays his favorite sport in the now-cleared Champs de Mars park every time he returns to Haiti, which is about once every two or three weeks.

Altidor also deflected criticism that the Haitian government has squandered much of the humanitarian assistance it received in the aftermath of the January 2010 temblor.

Photo: Larry Luxner

Garbage pickup and sanitation are among the myriad problems confronting Haiti's overpopulated capital city, as seen by this trash-strewn street in downtown Port-au-Prince.

"Very little of the aid going to Haiti goes to public entities anyway, so in terms of accountability, it's hard to even claim that the government is stealing money, when in reality it's not being funneled to public entities but mainly to NGOs. How can you be stealing something you don't even have?"

In fact, Altidor says a big part of his job in helping run the Clinton Bush Haiti Fund "was to be certain this money wouldn't be wasted."

Yet the question of whether the money that's been poured into Haiti is being used wisely continues to haunt the international community. For instance, more than a quarter of $412 million in reconstruction funds has been earmarked for a sprawling free zone located along Haiti's north coast — far from any quake damage.

"Obviously, there was no earthquake here," senior Haitian official Michaël de Landsheer told the New York Times. "But in a sense everything in this country after the earthquake is reconstruction."

The 608-acre Caracol Industrial Park — inaugurated late last year by Bill Clinton in a deal partially brokered by his wife, Secretary of State Hillary Clinton — will create 20,000 garment manufacturing jobs while giving companies that invest there tax exemptions, duty-free access to the U.S. market and abundant cheap labor (Haiti's minimum wage for textile wage is set to increase next month from $3.75 to $5 a day).

Caracol's flagship tenant will be Sae-A Trading, a South Korean apparel maker with a long history of troubled labor relations in Guatemala, where it recently closed its factory in the wake of what the AFL-CIO called Sae-A's anti-union repression and "acts of violence and intimidation."

Though questions remain as to whether the project was rushed through without considering its drawbacks (the environmental impact and Sae-A's dubious labor track record), Haitian officials are adamant that Caracol will benefit the community.

Eventually, according to Martelly, the free zone, located 15 miles from the port city of Cap-Haïtien, could provide jobs for 65,000 people, boosting Haiti's garment workforce by more than 200 percent. Sae-A is pumping $78 million into the project's initial phase, while the U.S. government is contributing $124 million and the IDB $55 million.

Once operations at Caracol are under way, the Haitian government hopes to attract other clothing manufacturers that could benefit from U.S. trade preferences for made-in-Haiti apparel, as well as companies that make electronics and furniture. The IDB says the project will create more than $500 million in wages and benefits over the next 10 years, boosting the number of jobs in Haiti's formal private sector by at least 20 percent.

Though Altidor says the project will generate desperately needed jobs, he adds that Caracol is only one piece of a much larger puzzle to address Haiti's overwhelming needs.

"While Caracol constitutes a flagship project for Haiti currently in terms of investments and potential job creation, I believe Haiti will need many more of these investments if it is to come out of the poverty cycle. Caracol is a step in the right direction. However, it is one project in the government's economic strategy."

PACEGI is co-chaired by Clinton and prominent Haitian businessman Gregory Mevs, who has interests in hotels, manufacturing and tourism. Its mission is to advise Martelly on policy and strategic initiatives to attract investment that will create sustainable jobs. The goal: 500,000 jobs over the next four years.

In the short term, the ambassador says two of Haiti's top priorities at the moment should be securing a reliable source of energy and reducing the incidence of cholera and other infectious diseases by improving public health.

"Energy is a key component to attracting business, so there's a heavy focus right now on electricity," he said. Regarding health, "how likely am I going to entice a group of businessmen to make investments in Haiti if they feel they may catch something while they're down there? In that context, health is a national security problem. Not only are our own citizens dying, but it's keeping other folks away."

Cholera has already killed 7,000 people and sickened more than half a million ever since it was accidentally introduced to the country by Nepalese peacekeeping forces serving with the United Nations Stabilization Mission in Haiti (Minustah). The lack of access to clean water and sanitation has made Haitians particularly vulnerable to this water-borne scourge, and the Atlanta-based Centers for Disease Control and Prevention estimates the cost of eliminating cholera from the island of Hispaniola — which Haiti shares with the Dominican Republic — at $800 million to $1 billion.

Photo: Larry Luxner

The imposing Iron Market in downtown Port-au-Prince, destroyed by fire in 2008 and then by the earthquake in 2010, was rebuilt by Haiti's largest private investor, Digicel, at a cost of $18 million. Digicel's CEO, Denis O'Brien, financed the reconstruction of the historic landmark himself.

The fact that Minustah brought cholera to Haiti after an absence of 100 years has made the U.N. peacekeepers deeply unpopular there. That tension was further exacerbated by an incident involving four Uruguayan peacekeepers accused of raping a teenage boy — an episode that was caught on tape and surfaced on the Internet, enraging Haitians and sparking violent protests in Port-au-Prince.

Minustah's fiscal 2012 budget is $793.5 million, and the mission has about 7,300 peacekeeping troops, 2,870 police officers, 550 international administrative personnel and 1,350 local civilian staffers deployed throughout the Maryland-size country.

Altidor declined to go into details on a specific timetable for the withdrawal of Minustah troops — most of them from Latin American countries — "simply because I'm new in the position."

He also deflected questions on a central goal of the Martelly government: the eventual reinstatement of the Haitian armed forces. That's sparked lingering fears about reviving an institution that was notorious for decades of human rights abuses under the regimes of François "Papa Doc" Duvalier and his son, Jean-Claude "Baby Doc" Duvalier.

But whether security comes from a beefed-up national police force or from foreign soldiers, it needs to come soon if Haiti has any hopes of digging out of its perpetual misery.

Reducing street crime and cleaning up the country's image is critical not only to Haiti's beleaguered people, but also to bringing tourists back to the country's shores. In the 1950s, before Fidel Castro turned Cuba into a communist state, Haiti and Cuba were both popular with American tourists looking to enjoy Caribbean beaches and wild nightlife (the Clintons in fact honeymooned in Haiti). But tourism has dwindled to a trickle in Haiti — with the notable exception of Royal Caribbean's private island resort of Labadee on the north coast, which attracts 600,000 visitors a year.

"Ultimately, Haiti still needs to make meaningful progress in governance and recovery efforts. Infrastructure deficiencies that existed prior to the earthquake need to be addressed," said Anton Edmunds, a senior associate with the Center for Strategic and International Studies. "An open and transparent investment climate — along with sound policies that assure a level playing field where large and small businesses can prosper alike — will be critical for any long-term tourism success."

That is perhaps why the Martelly government seems intent to bring fresh entrepreneurial talent like Altidor into the fold. For his part, the young ambassador is determined to use his private sector experience to change Haiti's trajectory — and image.

"When it comes to business, a lot of folks don't view Haiti as an investment destination. People feel sorry for Haiti. Everything about Haiti is magnified, but in a detrimental way. One person gets kidnapped, and Haiti is the most violent country in the world," he lamented.

"We're trying to shift that focus. Most of the folks who sit on the plane going to Port-au-Prince are development people. But for us to start living and not just surviving, a good chunk of them should be leisure tourists who come to Haiti to enjoy themselves."

Another strong area for investment is the telecom sector. Digicel is the country's largest private investor; its Haiti revenues account for more than $400 million of its total annual sales of $4.5 billion. In fact, the deal Altidor came to close when the earthquake struck is now a reality: A conglomerate run by the Vietnamese military recently purchased 60 percent of state-owned Teleco. The transaction came to only $59 million, but the new operators have committed to spending at least $200 million on infrastructure.

Today, in fact, Haiti has more than 4 million mobile phone lines in service — up from only 132,000 mobile and fixed lines at the time of the quake. That gives the country a penetration rate of 65 to 70 percent. Nearly all of that is mobile, since Haiti has only 35,000 fixed lines.

Yet when Altidor needs to get in touch with his bosses, he prefers email.

"Given the importance of this embassy, it's critical that I remain in close proximity to the president and prime minister," he said. "We're always exchanging emails on a daily basis. With President Martelly, you know where he stands — and he's doing his best."

And so, apparently, is his enthusiastic envoy in Washington.

"I'm here to provide solutions, not to complain about the resources we lack," said Altidor. "This is my first real job in the public sector. I have decided to forego economic opportunities to make sure we do development right. If I didn't personally believe in this, I wouldn't have taken the job."